CySEC Launches Campaign to Combat the Risks of ‘Finfluencers’ on Social Media

The Cyprus Securities and Exchange Commission (CySEC) has introduced a new investor protection campaign aimed at addressing the growing impact of social media and financial influencers, or “finfluencers,” on investment decisions. The campaign consists of a public warning, an investor guide, and a series of social media posts designed to raise awareness of the risks associated with following unregulated financial advice online.

In its official warning, CySEC highlighted that individuals or entities providing financial advice or suggestions via media channels, including social media, may be in violation of the EU Market Abuse Regulation. The regulator emphasized that any financial recommendations shared with the public must be neutral, transparent, and fully disclose any potential conflicts of interest. Furthermore, those using digital platforms to influence investment decisions must adhere to the strict regulatory requirements surrounding investment advice.

CySEC's newly issued investor guide, titled “Unveiling the World of Finfluencers,” is part of a broader financial literacy campaign intended to help investors critically assess online financial content. The guide outlines how finfluencers operate and the dangers associated with relying on unregulated or unauthorized sources for financial advice. CySEC aims to equip the public with the tools needed to differentiate between credible investment information and potentially misleading content.

Dr. George Theocharidis, Chairman of CySEC, underlined the importance of this initiative, explaining that social media has become an essential component of corporate marketing strategies. He noted that celebrities, sports figures, and individuals with no formal financial training are increasingly offering advice and promoting complex financial products online. This trend, he stated, has emerged largely due to the lack of financial education among the public and the rapid rise of digital platforms.

Theocharidis pointed out that while some legitimate investment opportunities exist on the internet, a significant amount of content circulating on social media exposes investors to unnecessary risk. The campaign seeks to alert the public to the dangers of trusting unqualified financial influencers and urges investors to question the motives behind the advice they receive.

In addition to raising public awareness, CySEC is also calling on regulated firms that use influencer marketing to ensure that their promotions are transparent and compliant with regulatory standards. The regulator has already implemented monitoring tools to detect misleading or non-compliant online promotions, with a firm stance against companies that misinform the public or encourage risky investments without adequately explaining the potential dangers.

CySECs campaign sends a clear message: the regulator will not tolerate misinformation or the promotion of irresponsible investment strategies, whether through social media influencers or other channels. Investors are urged to exercise caution and seek regulated advice when making financial decisions.